Question 1

In the notes to the financial statements, the depreciation and amortization methods used should be described.

Accepted Answer

A) True 
 B)False

Question 2

The cost of a long-term asset is expensed

Accepted Answer

A) when it is paid for. 
B) as the asset benefits the company. 
C) in the period in which it is acquired. 
D) in the period in which it is disposed of. 
A) when it is paid for. 
B) as the asset benefits the company. 
C) in the period in which it is acquired. 
D) in the period in which it is disposed of.

Question 3

Salem Company hired Kirk Construction to construct an office building for ₤8,000,000 on land costing ₤2,000,000, which Salem Company owned. The building was complete and ready to be used on January 1, 2017 and it has a useful life of 40 years. The price of the building included land improvements costing ₤600,000 and equipment costing ₤750,000. The useful lives of the land improvements and the equipment are 10 years and 5 years, respectively. Salem Company uses component depreciation, and the company uses straight-line depreciation for other similar assets. What is the net amount reported for the building on Salem Company's December 31, 2017 statement of financial position?

Accepted Answer

A) ₤7,665,000 
B) ₤7,573,750 
C) ₤6,483,750 
D) ₤7,800,000 
A) ₤7,665,000 
B) ₤7,573,750 
C) ₤6,483,750 
D) ₤7,800,000

Question 4

Intangible assets are rights, privileges, and competitive advantages that result from ownership of long-lived assets without physical substance.

Accepted Answer

A) True 
 B)False

Question 5

The Accumulated Depreciation account represents a cash fund available to replace plant assets.

Accepted Answer

A) True 
 B)False

Question 6

Using the following data for Stevenson Industries, compute the return on assets. $\begin{array}{lr}
\text { Net Income } & 180,000 \
\text { Total Assets } 12 / 31 / 17 & 2,410,000 \
\text { Total Assets 12/31/16 } & 1,980,000 \
\text { Net Sales } & 250,000
\end{array}$

Accepted Answer

A) 7.5% 
B) 10.4% 
C) 8.2% 
D) 11.4% 
A) 7.5% 
B) 10.4% 
C) 8.2% 
D) 11.4%

Question 7

Recording depreciation each period is an application of the matching principle.

Accepted Answer

A) True 
 B)False

In the notes to the financial statements, the depreciation and amortization methods used should be described.

The cost of a long-term asset is expensed

Intangible assets are rights, privileges, and competitive advantages that result from ownership of long-lived assets without physical substance.

The Accumulated Depreciation account represents a cash fund available to replace plant assets.

Using the following data for Stevenson Industries, compute the return on assets. Net Income 180,000 Total Assets 12/31/17 2,410,000 Total Assets 12/31/16 1,980,000 Net Sales 250,000

Recording depreciation each period is an application of the matching principle.

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Managerial Accounting

Job Order Costing

Process Costing

Activity-Based Costing

Cost-Volume-Profit

Cost-Volume-Profit Analysis: Additional Issues

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Filters

Exam 8: Reporting and Analyzing Long-Lived Assets

In the notes to the financial statements, the depreciation and amortization methods used should be described.

The cost of a long-term asset is expensed

Intangible assets are rights, privileges, and competitive advantages that result from ownership of long-lived assets without physical substance.

The Accumulated Depreciation account represents a cash fund available to replace plant assets.

Using the following data for Stevenson Industries, compute the return on assets. Net Income 180,000 Total Assets 12/31/17 2,410,000 Total Assets 12/31/16 1,980,000 Net Sales 250,000

Recording depreciation each period is an application of the matching principle.

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Managerial Accounting

Job Order Costing

Process Costing

Activity-Based Costing

Cost-Volume-Profit

Cost-Volume-Profit Analysis: Additional Issues

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Filters